In volatile markets, dynamic hedging may be difficult to implement because

A) prices move too quickly for effective rebalancing.
B) as volatility increases, historical deltas are too low.
C) price quotes may be delayed so that correct hedge ratios cannot be computed.
D) volatile markets may cause trading halts.
E) All of the options are correct.

Dynamic Hedging

A strategy of managing risk that involves adjusting the number of derivatives used as financial instruments in proportion to the changing value of the underlying asset.

Volatile Markets

Financial markets that are characterized by rapid and significant changes in prices.

Rebalancing

Realigning the proportions of assets in a portfolio as needed.